Social Security Wage Base Increases to $118,500 in 2015
The Social Security Administration (SSA) announced on Wednesday, October 22, 2014, that the 2015 social security wage base will be $118,500, an increase of $1,500 from the 2014 wage base of $117,000.
As in prior years, there is no limit to the wages subject to the Medicare tax; therefore all covered wages are still subject to the 1.45% tax.
Additional .9% Medicare Tax continues for employees’
As in 2014, wages paid in excess of $200,000 in 2015 will be subject to an extra 0.9% Medicare tax that will only be withheld from employees’ wages.
Employers will not pay the extra tax.
FICA Continues at combined rate of 7.65%
The FICA tax rate, which is the combined social security tax rate of 6.2% and the Medicare tax rate of 1.45%, will be 7.65% for 2015 up to the social security wage base. The maximum social security tax employees and employers will each pay in 2015 is $7,347. This will be an increase of $93 for employees and employers.
Self-employment Tax Rate
The social security wage base for self-employed individuals in 2015 will also be $118,500. There is no limit on covered self-employment income that will be subject to the Medicare tax. The self-employment tax rate will be 15.3% (combined social security tax rate of 12.4% and Medicare tax rate of 2.9%) up to the social security wage base. In 2015, the maximum social security tax for a self-employed individual will be $14,694.
FICA coverage threshold for domestic, election workers
The threshold for coverage under social security and Medicare for domestic employees will be $1,900 in 2015, unchanged from 2014; the coverage threshold for election workers will be $1,600 in 2015, also unchanged from 2014.
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